Business Trends

Health Care Legislation Passed by House Will Force Job Losses

In Uncategorized on March 22, 2010 at 10:24 pm

The Senate-passed healthcare legislation will unquestionably burden Americans with countless mandates, new taxes, penalties and higher insurance premiums. Small businesses will be hindered by stringent regulations and taxes that will ultimately force them to slash jobs. This bill comes at a time when unemployment stands as the most important problem facing the country today.

The House on Sunday night voted 219-212 to send H.R. 3590, the Patient Protection and Affordable Care Act – the health care bill passed by the Senate on Christmas Eve – to President Obama for his signature. Later, the House voted 220-211 to approve H.R. 4872, the Health Care and Education Affordability Reconciliation Act of 2010, a package of amendments to the Senate bill. That measure now goes to the Senate, where it is expected to be considered this week.

The Senate bill imposes a penalty of $750 per full-time worker on companies with 50 or more employees that do not provide coverage to full-time workers. But the House reconciliation bill would increase that penalty to $2,000, with the first 30 workers exempted. If an employer offers coverage but the coverage is deemed unaffordable to a full-time employee, that employee can opt out to a new purchasing exchange. The company would then be assessed $3,000 for each of those employees up to a cap of $2,000 for every full-time worker on the payroll. This mandate becomes applicable in 2014.

The National Retail Federation expressed extreme disappointment at the House’s passage of sweeping health care reform legislation over the weekend, saying added labor costs under the bill will cost many retail workers their jobs.

“This is a historic moment, but not a cause for celebration. Congress has embarked on a dangerous, anti-job experiment in the midst of the worst economy our nation has seen in decades,” NRF Senior Vice President for Government Relations Steve Pfister said. “How many lost jobs will it take before Congress reverses course?”

“Our nation simply cannot afford more job losses during this economy, and many businesses already struggling to keep their doors open may not be able to withstand this added financial burden,” Pfister said. “Retailers have told Congress all along that we value our employees and want to expand upon the millions of workers and their families for whom we already provide coverage, but that to do that we need reform that would lower costs. Instead, we’ve been handed employer mandates that do just the opposite while doing little or nothing about the cost of medical care, which in turn drives higher coverage costs.”

“We are particularly concerned about mid-sized companies that are large enough for the mandates to apply but too small to have the ability to absorb these added costs,” Pfister said. “They could be among the hardest hit. And small businesses that drive so much of the job creation in our country are going to be forced to hold their size under 50 workers to avoid the employer mandate threshold.”

Under the bill, seniors will see their Medicare benefits significantly reduced, resulting in limited choices and higher costs. While Medicare will be cut, Medicaid will be expanded, despite the fact that the program is going broke and states are struggling to keep up with the expiring federal matching program. Imposing an unfunded mandate will only exacerbate Medicaid’s problems.

“If health care is not funded properly through Medicare then the end result will be greater rationing of our health care system and fewer, more costly options for Medicare recipients”, said Peter Shanley, CEO of The Small Business Council of America (SBCA), a national nonpartisan, nonprofit organization which represents the interests of privately-held and family-owned businesses on federal tax, health care and employee benefit matters.  “The quality and availability of health care will go down and Medicare patients will be hurt in the long run.”

The new health law also empowers federal officials to dictate how doctors treat privately insured patients (Senate bill, pp. 148-149).  Never before in history, except on narrow issues such as drug safety, has this been done. The bill will require nearly all Americans to be in a “qualified plan,” then says that plans can pay only doctors who implement whatever regulations the Secretary of Health and Human Services imposes to improve “quality.”  That covers everything in medicine — whether your cardiologist uses a stent or does bypass surgery, whether your ob/gyn settles for a pap smear or orders a pelvic sonogram.  It could also cover reproductive issues.

There are many problems with the nation’s current healthcare system that can be rectified through medical liability reform, pooling health insurance, offering tax incentives, allowing states to customize programs, and reforming insurance regulations. Forcing a government takeover of healthcare, especially through parliamentary gimmicks, will not solve America’s healthcare problems – it will only exacerbate them.

Study Reveals Government Agencies Perpetually Behind in Technology Adoption

In Uncategorized on March 8, 2010 at 7:18 pm

Leading government market research firm Market Connections, Inc., today announced a new survey that calls government agencies perpetually behind the curve in technology adoption compared to the private sector, and hampered in technology adoption as a result of old legislation.

The study, which explored perceptions and adoption of new and innovative technologies among federal government decision makers, revealed the perception of technology adoption in government agencies as “slow and difficult to keep going” like a vintage Model T.

The company conducted the survey in February on behalf of the Government Information Technology Council (GITEC). GITEC is a group of senior-level government executives organized to support the delivery of high-quality and cost-effective IT services to their customers. Market Connections released the findings at the GITEC annual summit, a forum for government leaders, industry and academia to share ideas, challenges and successes surrounding the implementation, management and use of Information Technology.

Lisa Dezzutti, president of Market Connections, said, “The findings show real progress in some emerging technology and application areas. But technology engines don’t seem to be revving to keep up with needs. When asked if innovations have found their way into daily applications, more federal  decision-makers compare their agencies to vintage cars rather than today’s hybrids.”

The majority of the 223 survey respondents serve in management, operations, or IT/MIS roles, with 39% of them employed in defense/military agencies and 61% employed in federal civilian or independent agencies.

Survey highlights indicate:

• Wireless/mobile solutions and cloud computing were cited most often as technologies that, while beneficial or promising, remain the most overlooked. In fact, nearly three-quarters of respondents were either unsure if their agency has a cloud deployment plan or very clear that it doesn’t have a plan.
• Forty-five percent (45%) of respondents said their agencies are perpetually behind the technology curve compared to the private sector, while another 39% say that old legislation negatively impacts their agencies’ adoption of new technologies.
• Budget limitations narrowly outpace security concerns as the top two challenges confronting the implementation of upcoming technology initiatives. In fact, 18% reported that general hardware and software updates were the most beneficial new or innovative technologies implemented in the last 12 months.
• Nearly three in ten respondents say their agencies are not actively engaging Gen Y in the workforce; however, more than a quarter are offering competitive salaries and benefits, providing flexible work environments and increased coaching and training, respectively.

IT Spending Increases; Focus on Optimizing Processes for Fast ROI

In Uncategorized on February 25, 2010 at 12:35 am

A recent survey conducted by Altada Solution – a leading provider of software solutions for the retail industry — shows that IT budgets appear to be recovering after the initial downturn at the start of last year’s recession, with averages for all retailers at 1.3% of sales compared to 1% last year, while 26% of respondents expect their IT budget to increase; the same figure as last year. The company released findings from the 2nd annual Global Retail CIO Survey, jointly sponsored with IBM.

However, while last year’s survey showed that increase to relate to projects already underway, this year’s interviews revealed more aggressive plans to implement new systems. The survey of 109 retail CIOs and IT Directors in both the Americas and Europe was undertaken in Q4 2009 by retail industry research specialists Martec International.

This year’s Global Retail CIO Survey clearly shows that optimizing the product / place / promotion offer is becoming an increasingly critical element of retail IT spend. More than 50% of retailers will be upgrading, replacing or implementing new systems in areas such as Automated Replenishment (52%), Assortment Optimization (58%), Promotions Optimization (56%), Promotions Management (54%), with a further 46% looking to invest in Demand Forecasting. Master Data Management (MDM) has the highest planned implementation of all applications studied in the survey, both across the Enterprise (35%) and for Supplier Management (28%).

“The top line statistics from this year’s survey, and indeed last year’s, suggest that the retail sector has survived the recession remarkably effectively,” said Allan Davies, CMO, Aldata Solution. “The truth is, though, that while the downturn hasn’t halted retailers’ IT spend, it has certainly changed the way that money is spent. Gone are the days of end-to-end, rip and replace projects, and instead we’re seeing a big focus on process optimization. Retail CIOs are not afraid of investing in new projects, but they need to see a quick return on investment. And by quick, I’m talking about months, not years.”

Customer is King

Systems to attract and keep customers featured prominently in this year’s survey. Multi-channel CRM was ranked as the most important application by respondents, with 42% having yet to implement multi-channel CRM, but with plans to do so within the next three years. Similarly 38% of CIOs surveyed plan to implement Loyalty systems – with customer data linked to buying patterns and behavior – within the next three years. And finally, systems that support the safety of customers were considered the most important application by 47% of respondents.

Sustainability Not a Priority

For the first time, attitudes to sustainability were considered as part of the research. Respondents were asked to score the impact of sustainability on IT spend and strategy on a scale of 1 to 10 (with 10 being the highest). The average emerged as a lukewarm 5.1. Views appeared to be polarized, with 13% considering sustainability to have a negligible impact on IT strategy, while 6% considered it to have a major impact. In terms of which applications retailers feel are having the greatest impact on sustainability, applications for store operations came top of the list. For the future, more retailers believe that multi-channel retailing will have the biggest impact on sustainability.

Related Links: IBISWorld industry reports

Software Publishing Industry in the U.S.

IT Consulting in the U.S.

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